CHICAGO: US grain and soy futures fell sharply on Wednesday, with corn and soybeans falling back from multi-month highs, on a round of profit taking following rallies earlier in the week. "The market is taking a breather," said Dewey Strickler, president of Ag Watch Market Advisors.
Chicago Board of Trade wheat and corn futures led the declines, both shedding 2.3 percent. The front-month wheat contract notched its biggest daily decline since Feb. 27.
"On the technical side of things, wheat has all momentum down with a new low on the move," Charlie Sernatinger, an analyst with ED&F Man Capital said in a note to clients. "Wheat charts are accelerating to the downside."
Traders noted some technical selling after the benchmark CBOT May wheat contract dropped below its 20-day moving average early in the session. The contract also dropped through a key support level at the 23.6 percent retracement point from the rally to its 2014 high hit on March 20.
CBOT May wheat settled down 16 cents at $6.69-1/4 a bushel.
Some forecasts for showers in the parched US Plains, which will provide relief to the developing wheat crop in those areas, also weighed down the futures market.
CBOT May corn shed 11-3/4 cents to $4.95-3/4 a bushel, its first losing session since March 26.
Some US farmers booked sales on the cash market this week when corn prices topped $5 a bushel, which contributed to the weakness in futures prices as commercial buyers hedged their recent purchases.
Traders said declines were limited by cold soil in the US Midwest that was likely to delay planting during the next few weeks.
"I don't think anybody wants to press the downside until you start to get the crop in the ground," said Bill Gentry, a broker at Risk Management Commodities.
CBOT soybeans for May delivery were down 22-1/4 cents at $14.62-1/4 a bushel. The market failed to break through the psychologically key $15 per bushel level during the overnight session, which caused some selling by technical traders when US trading started on Wednesday morning.
Declines in old-crop soybean futures outstripped losses in the new-crop months as traded unwound bull spreads built up amid rising concerns about tight supplies in the United States.
But cheaper supplies from Brazil and Argentina have shifted demand from overseas buyers to those countries, easing some pressure on the US stocks situation. Traders also said some South American cargoes of soybeans were set to arrive in the United States during the weekend.
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